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TEST # 2 Instructions Using the information provided to you below for the new start - up restaurant, Adib s Burgers and Chicken ( or

TEST #2
Instructions
Using the information provided to you below for the new start-up restaurant, "Adibs Burgers and Chicken" (or A.B.C. for short), students must complete the following ledgers, and answer the following associated questions:
The business' opening Balance Sheet
Year 1 Income Statement
End of Year 1 Balance Sheet
Year 1 Statement of Cash Flow
- Good Luck! -
Opening Account Balances
- The business currently holds a cash balance of 5,945
- Company holds 9,800's worth of inventory at all times
- All appliances owned by business; estimated total value of 92,000
- China and glassware valued at 12,500
- equipment, furniture and fixtures estimated value of 133,000
- prepaid FIRST AND LAST months rent at 9,350 per month (in year 1, we'll pay 11 months of rent, and keep only the LAST month on the balance forever)
- We own a new catering truck, valued at $77,162
- we have accumulated 3,002 in accounts payable
End of Year 1
- Earned total Revenues of 2.8 Million (36.5% burgers, 29.9% chicken, 19% soft drinks and side dishes, and the rest is merchandise)
- At the start of the year, we take out a NEW Bank Loan of 515,000, with a fixed interest fee of 97,850*The term on the loan is 4 years, and payments begin this year
- Cost of goods sold' (food and beverage cost) was 29%
- Costs of merchandising (merchandising costs) are an average of 80%
- Salaries paid at $404,158
- Other operating expenses at 148,945
- Rent payments are made
- Holiday Bonus given to each employee at the end of the year of $300, there are 16 employees
- Monthly payments towards loan
- Accounts payable settled from last year, and new balance of 3,843 is incurred
- increase inventory pars each year by 7%
- Tax Rate is 17.5%(last year balances are paid in current years)
-15% of Profit paid out in dividends
- The rate of dep. on the truck is 22%/year
- Glassware and china depreciate at 15%/year
- All other fixed assets depreciate at 10%/year

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